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Reliance Ups Second Quarter Guidance

Reliance Steel & Aluminum Co. said Tuesday that it expects higher earnings for its second quarter thanks in part to price increases as well a jump in gross margins.


The Los Angeles-based steel and aluminum distributor said it now expects second-quarter profit in a range of $2.00 to $2.10 a share up from prior targets of $1.50 to $1.60 a share.


“Because the prices for carbon steel products have increased more significantly and more rapidly than we had anticipated and because we have been successful in expanding our gross profit margins more than anticipated in the current environment, we have increased our earnings guidance,” Chief Executive David Hannah said Tuesday in a statement.


The company will post its second-quarter results July 17.


In April, Reliance trimmed its second quarter profit forecast to below Wall Street estimates at the time of $1.66, according to Thomson Financial.


“Demand remains more difficult to predict,” Chief Executive David Hannah said at the time. “We believe our customers will continue to be cautious in their buying, especially given the uncertainty in many areas of the economy and the mostly negative views of business activity portrayed by the media. Therefore we do not expect any significant changes in demand in any of our market segments.”


Shares in Reliance added 2.2 percent to $75.07 in early trading Tuesday.

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